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Human beings block out painful memories—that adolescent breakup, last week's shrimp salad—as a survival mechanism, so it's easy to forget that stocks have been to these lofty heights before. The Standard & Poor's 500 first tackled the 1,500 threshold as early as 2000, and again in 2007. Both attempts failed spectacularly.

A lot has to go right for this third time to be the charm. Corporate profits must keep growing; Europe, China, and U.S. interest rates all must behave; and it'd be nice if Washington stopped bickering long enough to balance the budget. But what else might help?

For a start, companies can start investing some of the money hoarded during the serial crises of recent years. Cash makes up a whopping 14% of corporate assets today, double the level two decades ago. Yet capital expenditure accounts for just 16.4% of cash, well below the 28.1% average since 1990. "Too little has been used for capex lately," says Brian Belski, BMO Capital Markets' chief investment strategist, who adds, "Cash preservation is a symptom of defensive management." And hoarding cash to buy back shares will become less appealing as stocks push record highs and as borrowing costs tick up from record lows.

It'll also help, of course, if stocks' noisy new highs begin to attract sidelined investors. And if gourmet burgers and selvedge denim are any indication, high price tags can draw quite a fawning following. Much has been made of the $19.6 billion steered toward U.S. stock mutual funds last month. But it's easy to be hopeful in January, and the last such monthly inflow, in April 2011, arrived just as stocks peaked that year.

Still, Jeffrey Kleintop, LPL Financial's chief market strategist, thinks a long-term rotation from bonds into stocks could begin this year. Having lived through two painful recessions, he says, "many individual investors consider the risk in investing to be the likelihood of suffering a loss during a quarter or a year, rather than the risk of missing longer-term investment objectives." That's why we've crowded into Treasurys despite diminishing yields. But the Barclay's Aggregate Bond index has just wilted for two straight months. "If we make it to three, it will be the first time since 2008 that we've seen bonds provide losses to investors for that long."

Such losses were routine in the decades just after World War II, when bonds struggled as 10-year Treasury yields climbed steadily from 2% in 1945 to 16% by 1981. Since then, however, bonds have earned stellar annual returns averaging 15%, while the 10-year yield shrank to a record 1.5% last summer. Throughout these two Jekyll and Hyde phases, stocks generated fairly consistent annual returns of 12.5%, but our attitude toward them has soured dramatically. Once upon a time, adding stocks to a portfolio increased risk but also potential returns, notes James Paulsen, Wells Capital Management's chief investment strategist. But after 1981, he says, "boosting stock exposure in the portfolio mostly increased risk, and only marginally improved returns." Is it any wonder we can't stop cuddling up to bonds?

ALAS, A BULLISH TILT TOWARD stocks is quickly becoming consensus, and the crowd increasingly expects any correction to be short and shallow. Our five-year high also owes a lot to the bubble in monetary policy, as surely as previous highs were egged on by the tech and credit bubbles. The boost from beating low-ball fourth-quarter profit estimates is behind us, and margin debt is rising. Will a noisy Italian election this month focus attention back on Europe's malaise?

Kleintop, for one, thinks this bull has legs. Otherwise, he says, "Stocks would be ending a bull market with the S&P 500 priced at the lowest multiple of earnings at a bull-market peak since World War II"—roughly 14.5 times what companies earned over the past year, versus 28.2 times at the 2000 peak, or 16.8 times in 2007. Ned Davis Research also cited the adage about how bull markets are born on pessimism, grow on skepticism, mature on optimism, and die of euphoria. "My guess is that we are now maturing on optimism," writes Ned Davis.

As we keep our eyes peeled for euphoria, it helps to remember that, adjusted for inflation, the S&P 500 will need to reach 2,026 to surpass its former peak, says Doug Ramsey of the Leuthold Group. Price the stock market in Swiss francs or gold and we're roughly 48% or 84% away, respectively, from a new record. It's enough to not get too carried away, for now.